Axpo Misses Renewable Energy Targets, Coupon Premiums Rise
Axpo, Switzerland's largest power producer, has missed sustainability targets linked to three sustainability-linked bonds (SLBs), leading to a coupon step-up for these bonds which Axpo has agreed to pay.
Axpo's SLBs had key performance indicators (KPIs) related to cumulative installed renewable energy capacity since 2021. The targets were 1500MW by September 2024 and 2300MW by September 2025, both of which were missed. Due to these missed targets, the coupon premium for the three bonds increased by 0.34% (for bonds maturing 2027), 0.2% (bonds maturing 2026), and 0.15% (bonds maturing 2029). Axpo's 2024 sustainability report noted that SLB-linked renewable energy capacity additions were below target, and the company expected to miss the 2025 target due to challenges such as geopolitical headwinds, skilled worker shortfalls, and lengthy approval procedures. Despite missing the expansion targets, Axpo maintains its ambitious sustainability objectives.
Axpo, despite missing its renewable energy capacity targets, has not altered its commitment to sustainability. The company acknowledges the challenges faced and continues to strive towards its long-term goals, with the increased coupon payments serving as a reminder of the importance of meeting sustainability targets.
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